What Determines a stock's price?

Stock is worth whatever people are willing to pay for it.  Which would you rather own, a profitable company with strong sales, or a company that is losing money and has declining sales?  You wouldn't be alone choosing the first company, and with so many people wanting a share of it, the price will go up.

A market also reacts to news.  Could good movie reviews make you money?  It could if you own stock in Disney when it releases a hit movie.  Investors are always looking for positive news so they can catch a stock before it rises.

Not all news is good however.  What happens if a manufacturer's new product doesn't sell?  What if they produce a defective product?  What if business is going fine until somebody else starts selling the same type of product for half the price?  Investors are also watching for bad news, so they can sell a stock before it starts to lose ground.